THE RISE AND FALL OF THE ‘FRACK MASTER’

News Article Sponsored by Wellkeeper

How tech entrepreneur Chris Faulkner transformed himself into the oilfield “Frack Master” is a story of how news outlets become unwitting accessories in promoting expert reputations. It’s also a cautionary tale with warnings about what consumers can do to spot puffery while it’s happening.

Until May, Faulkner’s magazine covers and industry accolades hung from the walls of Breitling Energy’s corporate offices on Pacific Avenue in downtown Dallas. They were part of an intensively planned media campaign to create the persona that made Faulkner one of the most called-upon guests of major network business shows.

But today, those walls lay bare, their emptiness calling attention to Faulkner’s sudden rise and spectacular fall from the oil and gas big leagues.

The implosion ended in June, when the U.S. Securities and Exchange Commission accused Faulkner and his Breitling colleagues of pulling off an $80 million fraud by embellishing the returns they could deliver to investors on wells they drilled.

The government also alleges that Faulkner spent at least $30 million in investor funds to support his “lifestyle of decadence and debauchery” that included “lavish meals and entertainment, international travel, cars, jewelry, gentlemen’s clubs and personal escorts.”

Faulkner’s frequent media appearances were key in his ability to convince investors he was trustworthy, the SEC alleged in court filings.

“As soon as [Breitling] began offering investments in oil and gas prospects, Faulkner misrepresented his education, experience and background,” government lawyers wrote in laying out their case. “ He represented that he had extensive and diverse experience ‘in all aspects of oil and gas operations,’ when he had no such experience.”

Efforts to reach Faulkner were unsuccessful. His attorney, Larry Friedman of Dallas, commented on his behalf.

“The investors were happy when oil prices were high,” he said. “When prices came down, investors became unhappy and blamed [Faulkner]. He may be one of the most notable, but not the only one. You get the reward for being a public figure, but you also pay the penalty.”

The reward lasted for a while. From 2012 to 2016, Faulkner regularly popped up on CNBC, CNN, Fox Business and the BBC as a knowledgeable Texas oilman willing to comment on the day’s energy market happenings.

Those appearances carried a value of $241,752 in “free media” for Faulkner, according to research firm Mediaquant. That’s what it would have cost Faulkner to buy advertising equal to his broadcast time.

Unlike many of Texas’ legacy oilmen, Faulkner didn’t get his start in the oil business. He began in the 1990s with C I Host, a Bedford website data hosting company. Faulkner no longer works for the company, which had oil and gas firms as customers. Website hosting provided Faulkner with “his only exposure to the oil and gas industry,” according to the SEC.

By 2004, records show, Faulkner founded Southwest Energy Exploration LLC. In 2010, the company’s name changed to Breitling.

Faulkner won the “Frack Master” nickname from the trade publication Oil & Gas Monitor. He wrote for the publication as well. In 2012, he bylined a piece titled “Oil and Gas Best Kept Secrets: Secrets of Oil and Gas Investments for the Average Individual,” which offered, ironically, a guide on how not to be misled by energy companies.

The memorable moniker was used consistently by news anchors introducing him to their audiences. CNN anchor Richard Quest highlighted its significance in January during a segment with Faulkner.

“The Frack Master,” Quest said, “that name will stick with you forever.”

The mechanisms Faulkner deployed to become a go-to guest are time-proven. Beneath the layers of marketing and advertising rest public relations specialists, professionals trained in consumer behavior and media patterns.

Around 2012, Faulkner hired a publicist, the New Jersey-based Ann L. Stephenson Group.

Ann Stephenson, co-owner of the former agency, said Faulkner and her team formed a well-organized, aggressive pursuit of media interviews by sending news releases and emails to news outlets. Faulkner and Breitling also bought advertisements on the radio and in newspapers.

“He was looking for a PR group, and he was an excellent spokesman,” Stephenson said.

They tried several strategies.

Stephenson said Faulkner suggested they produce a film exploring the basics of hydraulic fracturing. During winter 2013, Faulkner hired veteran filmmaker Robin Bossert to direct Breaking Free: The Shale Rock Revolution. By summer 2014, the movie was edited and ready for release.

The movie features scientists, oil and gas researchers, Texas politicians and families who said they’d benefited from companies drilling on their land. It is available online, including on iTunes, Amazon and Google Play. The film did not reach theaters. Bossert said the documentary was rejected by every film festival except the Boston Film Festival.

Stephenson said she also suggested to Faulkner that he publish a book.

Faulkner agreed and began assembling The Fracking Truth: America’s Energy Revolution: The Inside, Untold Story in 2012. The hardback took about two years to finish. In it, he laid out some of the same arguments he made in TV news segments aired around the world.

From 2012 to 2015, Breitling bought ads that ran three times a day during the weekdays on KRLD-AM (1080), CBS’ Dallas-Fort Worth radio station, for his “Oil & Gas Today” segments. Faulkner gave short commentary about energy reports and other industry news, as well as explanations of fracking.

When he made it to TV, he played his Texas oilman role to the hilt, wearing pinstriped suits and cowboy boots. In a segment for The Weather Channel, Faulkner stood on a drill site somewhere in West Texas answering questions about fracking and a recent spate of earthquakes.

Joe Simo was Breitling’s in-house geologist. He said Faulkner had a pretty good grasp of the business, even as prices were crashing.

“Faulkner is a very intelligent guy,” he said. “I have no problem saying that. This is just greed.”

The SEC cited Simo as well as Faulkner for fraud. The agency says Simo hugely fudged oil well production forecasts. Simo blames Faulkner for enticing investors. No matter who produced the forecasts, many wells delivered less than 10 percent of what investors had been told.

The company finances unraveled faster than Faulkner’s media-driven reputation. In December, months before the government accused it of being a fraud, a Dallas County judge ordered Breitling to pay $172,768 to CBS Radio Texas Inc. for failing to pay KRLD for the ads.